Now that the Republican plan to repeal the Affordable Care Act seems dead in the water and President Donald Trump has said he would simply let Obamacare fail, many are wondering exactly what that means. Some think Trump intends to eliminate the federal subsidies, or CSRs, that help insurers cover low-income customers.
The nonpartisan Congressional Budget Office recently did an analysis of what scrapping those subsidies would mean. The CBO estimated such a move would send premiums skyrocketing an average of 20%.
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The CEO of Independence Blue Cross in Philadelphia agreed with the CBO that eliminating ACA subsidies would send costs skyrocketing.
Independence Blue Cross CEO Daniel Hilferty estimated that his customers would see an 8% premium increase if the subsidies went away. While that’s not the CBO average of 20%, Hilferty still stressed that it was a substantial hike.
“Well, if you look at it – let's put it in context,” Hilferty told NPR. “We cover 200,000 people, roughly, in the five-county Philadelphia area, another 100,000 people throughout the state of New Jersey. Forty-six percent of them rely on a subsidy, or the CSR payments. So those folks would be impacted, as the CBO indicated, at a significant increase.”
Hilferty pointed out that if Trump scrapped the subsidies, many people who continued to purchase insurance on the ACA exchanges would be eligible for tax credits – meaning the government would still be paying for them. Hilferty told NPR that he thought the argument over the ACA was primarily a “political struggle between preserving the Affordable Care Act or moving towards a new type of coverage.”
“From our perspective, what keeps me awake at night is that we have 300,000 people who rely on Independence Blue Cross for coverage,” Hilferty said. “We just want to make sure that, until we figure out what reform looks like going forward, that these CSRs are funded, that the mandate stays in place so that we can provide coverage to the people who rely on us day in and day out for their health benefits.”
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